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EXECUTIVE SUMMARY
efficiency could do, country-by-country and sector-by-sector, for energy markets, the economy and the environment.
The Iraqi energy sector, examining both its importance in
satisfying the countrys own needs and its crucial role in meeting global oil and gas demand.
The water-energy nexus, as water resources become
to modern energy services. There are many uncertainties; but many decisions cannot wait. The insights of WEO-2012 are invaluable to those who must shape our energy future.
www.worldenergyoutlook.org
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Executive Summary
A new global energy landscape is emerging
The global energy map is changing, with potentially far-reaching consequences for energy markets and trade. It is being redrawn by the resurgence in oil and gas production in the United States and could be further reshaped by a retreat from nuclear power in some countries, continued rapid growth in the use of wind and solar technologies and by the global spread of unconventional gas production. Perspectives for international oil markets hinge on Iraqs success in revitalising its oil sector. If new policy initiatives are broadened and implemented in a concerted effort to improve global energy efficiency, this could likewise be a game-changer. On the basis of global scenarios and multiple case studies, this World Energy Outlook assesses how these new developments might affect global energy and climate trends over the coming decades. It examines their impact on the critical challenges facing the energy system: to meet the worlds ever-growing energy needs, led by rising incomes and populations in emerging economies; to provide energy access to the worlds poorest; and to bring the world towards meeting its climate change objectives. Taking all new developments and policies into account, the world is still failing to put the global energy system onto a more sustainable path. Global energy demand grows by more than one-third over the period to 2035 in the New Policies Scenario (our central scenario), with China, India and the Middle East accounting for 60% of the increase. Energy demand barely rises in OECD countries, although there is a pronounced shift away from oil, coal (and, in some countries, nuclear) towards natural gas and renewables. Despite the growth in lowcarbon sources of energy, fossil fuels remain dominant in the global energy mix, supported by subsidies that amounted to $523billion in 2011, up almost 30% on 2010 and six times more than subsidies to renewables. The cost of fossil-fuel subsidies has been driven up by higher oil prices; they remain most prevalent in the Middle East and North Africa, where momentum towards their reform appears to have been lost. Emissions in the New Policies Scenario correspond to a long-term average global temperature increase of 3.6C.
Executive Summary
United States, which currently imports around 20% of its total energy needs, becomes all but self-sufficient in net terms a dramatic reversal of the trend seen in most other energyimporting countries.
Norway combined, easing the pressure for new discoveries and development. Additional investment of $11.8 trillion (in year-2011 dollars) in more energy-efficient technologies would be more than offset by reduced fuel expenditures. The accrued resources would facilitate a gradual reorientation of the global economy, boosting cumulative economic output to 2035 by $18trillion, with the biggest gross domestic product (GDP) gains in India, China, the United States and Europe. Universal access to modern energy would be easier to achieve and air quality improved, as emissions of local pollutants fall sharply. Energyrelated carbon-dioxide (CO2) emissions would peak before 2020, with a decline thereafter consistent with a long-term temperature increase of 3C. We propose policy principles that can turn the Efficient World Scenario into reality. Although the specific steps will vary by country and by sector, there are six broad areas that need to be addressed. Energy efficiency needs to be made clearly visible, by strengthening the measurement and disclosure of its economic gains. The profile of energy efficiency needs to be raised, so that efficiency concerns are integrated into decision making throughout government, industry and society. Policy makers need to improve the affordability of energy efficiency, by creating and supporting business models, financing vehicles and incentives to ensure that investors reap an appropriate share of the rewards. By deploying a mix of regulations to discourage the least-efficient approaches and incentives to deploy the most efficient, governments can help push energy-efficient technologies into the mainstream. Monitoring, verification and enforcement activities are essential to realise expected energy savings. These steps would need to be underpinned by greater investment in energy efficiency governance and administrative capacity at all levels.
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Energy efficiency can keep the door to 2C open for just a bit longer
Successive editions of this report have shown that the climate goal of limiting warming to 2 C is becoming more difficult and more costly with each year that passes. Our 450 Scenario examines the actions necessary to achieve this goal and finds that almost four-fifths of the CO2 emissions allowable by 2035 are already locked-in by existing power plants, factories, buildings, etc. If action to reduce CO2 emissions is not taken before 2017, all the allowable CO2 emissions would be locked-in by energy infrastructure existing at that time. Rapid deployment of energy-efficient technologies as in our Efficient World Scenario would postpone this complete lock-in to 2022, buying time to secure a muchneeded global agreement to cut greenhouse-gas emissions. No more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to achieve the 2 C goal, unless carbon capture and storage (CCS) technology is widely deployed. This finding is based on our assessment of global carbon reserves, measured as the potential CO2 emissions from proven fossil-fuel reserves. Almost two-thirds of these carbon reserves are related to coal, 22% to oil and 15% to gas. Geographically, two-thirds are held by North America, the Middle East, China and Russia. These findings underline the importance of CCS as a key option to mitigate CO2 emissions, but its pace of deployment remains highly uncertain, with only a handful of commercialscale projects currently in operation.
Executive Summary
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efficient gas-fuelled power sector and, once domestic demand is satisfied, of gas exports. Translating oil export receipts into greater prosperity will require strengthened institutions, both to ensure efficient, transparent management of revenues and spending, and to set the course necessary to encourage more diverse economic activity.
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Executive Summary
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